Virgin Money has priced shares for the float of a 25 per cent state in the business at 283 pence each prior to listing on the London Stock Exchange next week.

The Edinburgh-headquartered bank, which had postponed the plans in October citing “market conditions”, said based on the offer price, Virgin Money’s market capitalisation will be “approximately £1.25 billion at the commencement of conditional dealings”.

The share pricing is at the bottom of the range price previously set by the lender at between 282 pence and 333 pence.

Shares are expected to begin trading on November 18, and Virgin Money said it expects to receive approximately £150 million of gross proceeds from the Offer.

Employees will each receive £1,000 worth of shares in the business when it lists.

Virgin Money, which was created from the 'good' bank assets of nationalised Northern Rock, had expected to join the stock market in November valued at around £2 billion.

The lender previously stated the float would, “support the Company’s growth plans, support the Company’s common equity tier 1 capital ratios, give the Company access to a wider range of capital-raising options and further improve the ability of Virgin Money to recruit, retain and incentivise its key management and employees”.

The listing will also finance a final £50 million payment to the UK Government payable as part of the agreement on its acquisition of Northern Rock plc in January 2012.

The lender booked a £26 million provision in its first-half results announcement in September which was to go towards settling a prior agreement with the Treasury if it was to float between 2012 and 2016.

Virgin said the final £50 million payment to the Treasury, which will be made at the completion of the IPO, will take the total paid to the Treasury to £1.02 billion.

“Our capability to deliver growth at meaningful scale, the quality of our balance sheet and the fact that we are unburdened by legacy issues makes us stand apart from other banks, and these strengths give us the potential to deliver on-going returns to our shareholders through both capital growth and progressive dividend payments.

“The completion of our IPO will see us make a final payment to the Government of £50 million as consideration for our acquisition of Northern Rock plc, taking the total paid to over £1 billion.

“As we begin life as a public company, we are committed to maintaining the straightforward, transparent approach to business that we believe helps differentiate us.

“We are passionate about improving competition in UK retail banking and believe that today’s IPO is another step forward for us as we seek to deliver on that objective.

“I would also like to thank all of my colleagues at Virgin Money for their hard work in bringing us to this point.

“There are many colleagues, like me, who have spent 20 years working with the Virgin brand.

“As we previously announced, each employee will be awarded £1,000 worth of shares in the business upon flotation meaning that all colleagues have a stake in our future success.”

Virgin Money currently has around 2.8 million customers and provides mortgages, savings and credit cards via online and mobile channels, 75 stores and five customer lounges.